Current Expected Credit Losses Policy
The purpose of this Current Expected Credit Losses Policy Template (CECL Policy Template) is for a bank, credit union, fintech company, or other type of financial institution to maintain an adequate methodology for estimating and maintaining allowances for credit losses to properly reflect an accurate financial position of the organization and to comply with regulatory and Financial Accounting Standards Board (FASB) guidelines.
Table of Contents
- Purpose and Contents – Topic 1
- Policy Statement – Topic 2
- Definitions – Topic 3
- Responsibility – Topic 4
- Risk Management – Topic 5
- Measurement Methods – Topic 6
- Measurement of ACLs for Loans, Leases, HTM Debt Securities, and Off-Balance-Sheet Credit Exposures – Topic 7
- Measurement of ACLs for Available-for-Sale Debt Securities – Topic 8
- Use of Vendors – Topic 9
- Portfolio Segmentation – Topic 10
- Qualitative Adjustments and Systematic Allowance Processes – Topic 11
- Recommendations, Documentation and Approval – Topic 12
- Audit Policy – Topic 13
- Staff Training – Topic 14
- Retention of Documentation – Topic 15
Recent updates to this product:
OCC Bulletin 2022-20 – Accounting: Bank Advisory Series Updated – Accounting Standards Update (ASU) 2022-02 – “Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures”
This Current Expected Credit Losses Policy Template (approximately 53 pages) is available in Microsoft® Word format.
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